How Can We Explore Patterns of Customer Segments' Structural Changes? A Sequential Rule Mining Approach

In real world situations, customer behavior is changing and evolving over time. It is necessary to consider this dynamism in customer segmentation analysis and other business-related activities to develop effective marketing strategies. The main aim of this study is to explore the patterns of customer segments' structural changes. Up to now, there has been no research on this particular topic. This is the first study that investigates the impact of customer dynamics on segments' structural changes. This paper tries to develop a method to describe and explain this issue. A new method is proposed based on the clustering and sequential rule mining techniques. Furthermore, a new definition and framework for finding distinguishing sequential rules is developed. The proposed method is implemented on the customer data of a telecommunication service provider. The results show that the method is capable in this domain. The findings reveal a group of customers whose dynamic behavior causes structural changes. We name this group as "structure breakers". The marketing managers of this company can use the obtained results to improve their marketing strategies and decision-making. This method can be used in every other organization to mine the patterns of segments' structural changes.